The Directors have pleasure in presenting their Report and Audited
 Accounts of the Company for the year ended March 31, 2011.
 
 Financial Results
 
                                                     (Rs. Crore)
                                             2010-11     2009-10
 
 Total Revenue                              2,327.36    2,060.92
  
 Sales (Excluding Excise Duty)              2,220.56    1,962.46
 
 Other Income                                 106.80       98.46
 
 Profit before Taxation                       519.95      484.80
 
 Provision for Taxation                       117.37       61.54
 
 Profit after Taxation                        402.58      423.26
 
 Balance taken over on Amalgamation 
 of subsidiary company                          2.59           –
 
 Balance brought forward                       91.95       28.84
 
 Profit available for appropriation           497.12      452.10 
 
 Appropriation :
 
 Dividend                                     299.18      271.98
 
 Dividend Tax                                  49.69       45.84
 
 General Reserve                               40.26       42.33
 
 Balance carried forward                      107.99       91.95
 
                                              497.12      452.10
 
 
 Business Performance
 
 The year 2010-11 was another challenging year for the global markets.
 However, the resilience shown by the Indian economy was heartening. But
 the continued high level of food inflation along with the firming up of
 commodity costs has led to an inflationary business environment.
 Uncontrolled high inflation could dampen the growth trend in Indian
 market.
 
 In this challenging environment, your Company achieved a healthy
 double-digit sales growth during the year 2010-11. Sales for the year
 increased by 13 per cent at Rs. 2,221 crore as against Rs. 1,962 crore
 during the previous year. The toothpaste business registered an
 impressive volume growth of 13 per cent during the year.
 
 The profit before tax for the financial year 2010-11 was Rs. 520 crore
 as against Rs. 485 crore during the previous year. During the year,
 your Company significantly increased its investment in the brand and
 equity building
 
 activities by 16.7 per cent i.e. Rs. 50 crore. Despite this additional
 investment coupled with the lower deduction under the Income-tax
 regulations on the profits of the Baddi manufacturing facility
 resulting in higher year on year tax payments of Rs. 56 crore, the
 profit after tax for the financial year 2010-11 was Rs. 403 crore as
 against Rs. 423 crore during the previous year.
 
 The cash generation during the year continued to be strong arising from
 significant improvements in the business performance, efficiencies and
 cost savings across the organisation and a continued efficient
 collection system. Your Company managed investments prudently by
 deployment of the surplus funds after ensuring that such investments
 satisfy the Companys criteria of safety and security.
 
 Your Company continued to achieve excellent business results year after
 year despite the fierce competitive
 
 market environment. This has been possible since your Company has the
 right strategies in place which focused on consumers, dental
 professionals, retail customers with a stronger focus on innovation,
 greater effectiveness and efficiency everywhere, while strengthening
 organisational leadership.
 
 Winning with Consumers, Customers & Profession
 
 To best reach todays consumers, both in and out of the store, your
 Company focuses on integrated marketing communications that include a
 mix of traditional and new media as well as creative promotional
 activities.  Your Companys shopper marketing program, which focuses on
 in-store behaviour, is another way of identifying new growth
 opportunities for the Company and its retail partners.
 
 Your Company is also committed to building consumption by educating
 consumers about good oral hygiene habits. Once people adopt these
 habits, they stay with the same for a lifetime. Indeed the Companys
 Colgate Bright Smiles, Bright FuturesTM oral health education program
 has now reached over 95 million children since the program began.
 
 The Management of your Company is strongly focused on aligning its
 strategies and goals with those of its trade partners in order to
 achieve mutual success.  Small stores are just as important to your
 Company as the large ones. In order to better understand the
 small-store environment, the Company works closely with local
 merchandisers and shop owners to offer a relevant assortment of
 products and merchandising services to achieve high visibility in each
 store.
 
 The Company has developed strong relationships with dental
 professionals. This strategy has contributed greatly to increasing
 professional recommendations for the Companys brands. In India, 81 per
 cent of professionals are now recommending Colgate ahead of any other
 brand.
 
 Focus on Innovation
 
 The Companys growth is sparked by the innovative products that it
 brings to the market and also by ensuring that there is innovation at
 all price points. This strategy offers consumers a choice of products
 from entry level to super premium and allows them the opportunity to
 trade up as disposable income levels rise. During 2010-11, innovative
 products like Colgate Plax Mouthwash and Colgate Sensitive Toothpaste
 grew strongly to deliver new and improved benefits to consumers.
 
 Organisational Leadership
 
 Your Companys continuing success as the oral care market leader in the
 country is closely linked to the personal leadership demonstrated by
 its people at all levels within the organisation. The Company supports
 and encourages leadership in several ways by communicating its strategy
 throughout the organisation. It has strong Training & Development tools
 to build personal leadership and help people carry out their
 responsibilities effectively.
 
 As your Company continues to face tough challenges, it remains
 confident as it has the right strategies in place to build on the past
 success. Your Company is strongly focused on delivering the value-added
 products at all price points and is prepared to spend aggressively to
 support its brands and fuel top-line growth.
 
 Dividend
 
 The Companys strong cash generation and positive growth momentum led
 your Board to declare three interim dividends of Rs.10, Rs.5 and Rs.7
 per share aggre- gating Rs. 22 per share for the financial year 2010-11
 as against Rs. 20 per share in the previous year. These dividends were
 paid on August 30 and December 24, 2010 and April 19, 2011. Having
 declared three interim dividends, your Board has not recommended a
 final dividend for the financial year 2010-11.
 
 Responsibility Statement
 
 Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors,
 based on the representations received from the Operating Management,
 confirm :
 
 a) that in the preparation of the annual accounts, the applicable
 accounting standards have been followed and that no material departures
 have been made from the same;
 
 b) that they have, in selection of the accounting policies, consulted
 the statutory auditors and have applied them consistently and made
 judgments and estimates that are reasonable and prudent so as to give a
 true and fair view of the state of affairs of the Company at the end of
 the financial year and of the profit of the Company for that period;
 
 c) that to the best of their knowledge and information, they have taken
 proper and sufficient care for the maintenance of adequate accounting
 records in accordance with the provisions of the Companies Act, 1956
 for safeguarding the assets of the
 
 Company and for preventing and detecting fraud and other
 irregularities; and
 
 d) that they have prepared the annual accounts on a going concern
 basis.
 
 Corporate Social Responsibility
 
 Your Company in partnership with the Indian Dental Association (IDA)
 successfully concluded the 7th edition of a two-month long Oral Health
 Month Program during the year covering a wide spectrum of activities
 designed to spread oral health awareness and good oral hygiene
 practices. The mission of this Program continued to be Zero Tooth
 Decay involving dental professionals spread across 1000 towns. The
 two-month long oral care awareness drive covered in- clinic free dental
 check-ups, school contact program, free dental check-ups in mobile
 dental vans, retailers outreach program and many more such activities
 to engage consumers.
 
 Education has been the primary focus of your Companys Corporate Social
 Responsibility. Since 1976, your Company has been conducting a school
 initiative program (now called Colgate Bright Smiles, Bright FuturesTM
 Program) wherein your Company partnered with IDA, to spread oral health
 awareness among school-going children in urban and rural schools.  Till
 date, 95 million school children in 1,94,756 schools in urban and rural
 areas have benefited from this Program. In addition, your Company also
 conducts in conjunction with IDA a Teachers Training Program to enable
 teachers to instill good oral care habits among school-going children
 on an ongoing basis. Till date, 2,46,312 teachers have undergone this
 training.
 
 Since 2002, your Company partnered with Pratham, a non-profit
 organisation, to promote academic education of the less privileged
 children. The grant from the Company has supported the concept of
 Libraries in the S Ward of Mumbai where children are encouraged to
 read books to enhance their knowledge and continue their academic
 education. Your Company supports 65 schools in Pratham-focused
 communities in S Ward in Mumbai and also seeks to engage parents in
 the Mother Participation program to aid the learning process of the
 child.
 
 Your Company started supporting the children affected and infected by
 HIV with nutritional needs and school fees since last three years. The
 program has infused the children with hope leading to a definitive
 improvement
 
 in their academic performance and they now live with more confidence
 despite their HIV positive condition.
 
 Your Company will continue to take such measures to make a positive and
 significant contribution to the society.
 
 Guinness World RecordsTM
 
 Your Company in association with the Indian Dental Association achieved
 in November 2010 a Guinness World Record by providing dental check-ups
 to 66,322 children on a single day across multiple locations involving
 33 schools in five cities across India.
 
 Your Company also achieved in January 2011 a Guinness World Record
 wherein around 1,011 school children rinsed simultaneously with Colgate
 Plax Mouthwash.
 
 With these records, your Company achieved a hat-trick of Guinness World
 RecordsTM in the oral care category that started of in 2007 with the
 Colgate Brush-up Challenge where 1,77,003 students from 380 locations
 in 22 cities across the country, in one day and at one time, brushed
 their teeth for one minute.
 
 Corporate Governance
 
 A separate report on Corporate Governance along with the Auditors
 Certificate on its compliance is attached as Annexure 1 to this Report.
 
 Employee Relations
 
 The employee relations in the Company continued to be positive. During
 the year, a long-term settlement was signed with the Goa Factory Union
 through a process of bilateral negotiations which would, amongst other
 things, improve productivity.
 
 Information as per Section 217(2A) of the Companies Act, 1956 (the
 Act) read with the Companies (Particulars of Employees) Rules, 1975
 forms part of this Report. As per the provisions of Section 219(1)
 (b)(iv) of the Act, the Report and Accounts are being sent to the
 shareholders of the Company excluding the statement on particulars of
 employees under Section 217(2A) of the Act. Any shareholder interested
 in obtaining a copy of the said statement may write to the Secretarial
 Department at the Registered Office of the Company.
 
 Trade Relations
 
 Your Directors wish to record appreciation of the continued unstinted
 support and co-operation from
 
 its retailers, stockists, suppliers of goods/services, clearing and
 forwarding agents and all others associated with it. Your Company will
 continue to build and maintain strong links with its business partners.
 
 Energy, Technology Absorption and Foreign Exchange
 
 The information required under Section 217(1)(e) of the Companies Act,
 1956 read with the Companies (Disclosure of Particulars in the Report
 of the Directors) Rules, 1988 with respect to conservation of energy,
 technology absorption and foreign exchange earnings/ outgo is appended
 hereto as Annexure 2 and forms part of this Report.
 
 Directors
 
 Effective September 1, 2010, Mr. Paul Alton was appointed as the
 Whole-time Finance Director of the Company for a period of five years
 subject to the approval of the shareholders and the Central Government
 under the provisions of the Companies Act, 1956. The Central Government
 by its letter dated January 21, 2011 has accorded an in-principle
 approval subject to his appointment being approved by the shareholders
 at the ensuing Annual General Meeting.
 
 Mr. M. A. Elias stepped down from the Board effective November 30,
 2010. He was appointed Whole-time Director of the Company since April
 1997 and during this period, he had made several significant
 contributions to the Companys growth and implementation of investment
 plans and business strategies. The Board places on record their
 appreciation for the distinguished
 
 services rendered by Mr. Elias during his tenure with the Company.
 
 Under Article 124 of the Companys Articles of Association, Mr. J. K.
 Setna and Mr. V. S. Mehta retire by rotation at the 70th Annual General
 Meeting and, being eligible, offer themselves for re-appointment.
 
 Auditors
 
 Messrs. Price Waterhouse, Chartered Accountants, retire and are
 eligible for re-appointment as Auditors.
 
 Cost Auditors
 
 The Central Government vide its letter dated May 18, 2010 accorded its
 approval to the appointment of Messrs. N. I. Mehta & Company as the
 Cost Auditors for auditing the cost accounts relating to cosmetics and
 toiletries for the financial year 2010-11. The due date for submission
 of the cost audit report for the financial year 2009-10 was September
 27, 2010 and the actual date of submission of the report was September
 24, 2010.
 
 Acknowledgements
 
 Your Directors sincerely appreciate the high degree of professionalism,
 commitment and dedication displayed by employees at all levels. The
 Directors also wish to place on record their gratitude to the Members
 for their continued support and confidence.
 
 
                                             On behalf of the Board
 
                               Mukul Deoras              R. A. Shah
                               Managing Director      Vice-Chairman
 
 May 30, 2011